Protecting Your Family — What You Really Need to Know About Your Auto Insurance Policy

Protecting Your Family — What You Really Need to Know About Your Auto Insurance Policy

It is common knowledge that automobile accidents represent one of the highest ‘risk of injury’ in the lives of most people.  Over the years, my law firm has seen hundreds of East Texans injured in serious automobile accidents.  Sadly, in many of these cases, the person at fault either had little (or no) insurance to cover the injuries caused by the accident.

 By making sure that your auto policy includes a relatively inexpensive ‘add on’ coverage, you can go a long way toward protecting yourself and your family in the event you are involved in a serious accident of this nature.  In fact, for just a few dollars a month (over state required minimum policies) most people can significantly increase their coverage protection.

There are basically three types of auto insurance:

1)  Liability Insurance  –  Designed to pay others for personal injury and property damage if you cause an accident.  [State required and expensive]

2) Collision  –  Designed to pay for your car repairs.  [This coverage can be moderately expensive.]

3) Personal insurance designed to protect you, your family, and your passengers in an accident.  This coverage is relatively inexpensive and is by far the most important coverage to protect your family.  Unfortunately, most people never get a full explanation of the real value of this relatively cheap insurance from their agents.

There are also three types of auto insurance in this third category.  They are Underinsured/Uninsured motorists coverage [UIM], Personal Injury Protection [PIP], and Medical Benefits Coverage [Med-Pay].

Perhaps the most important of these is Uninsured/Underinsured motorist coverage.  UIM covers you, your family, and any other person riding in your vehicle if the at fault driver doesn’t have insurance (or enough insurance) to cover all the damages.  I explain to my clients that purchasing UIM coverage is like buying a liability policy on every single person in the world just in case they crash into your car (or family).  In other words, your liability policy protects other people if you cause an accident.  That’s good. However, for just a few dollars a month, a UIM policy also protects you, your family, and every passenger in your vehicle if the other driver caused the accident.

Another piece of critical advice I give my clients is to be sure to get price quotes on a range of different coverage levels.  Unless you ask, many agents will only quote a minimum level policy (perhaps hoping to win your business with the cheapest bid).   However, you can probably get ten times the protection [$250,000.00 in coverage] for just a little more money.  For example, my premium for a six month auto policy with USAA is $463.15 and provides coverage at $300,000/$500,000/$50,000.   Out of the total six month premium, $78.07 is for liability property coverage (i.e. $50,000 to pay for the other person’s car if the accident is my fault).  At the same time, I pay only $38.31 every six months for $500,000.00 in UIM coverage protecting every person in my car if we are hit by an uninsured/underinsured driver.  That is a mere $6.38 per month for a half million dollars in UIM coverage!

Insurance companies are able to sell these much larger policies for only slightly higher premiums because serious injuries are statistically rare.  On the other hand, it is in the case of a rare, but serious, accident when most individuals and/or families need protection.  With the high costs of today’s medical bills, adding Uninsured/Underinsured motorists coverage [UIM] to your auto policy makes a lot of sense.  Once your agent has provided prices for a range of different coverage amounts, then you can chose the level of coverage that protects your family and meets your budget.

As a service to the community, our office offers a free review of your insurance policy.  Anyone who would like more information can call (936) 632-2000 to schedule a free appointment.  Additional answers to common questions [like why you should always buy PIP instead of MedPay] can be found on our website at

Mike Love